Published: Thursday, March 6, 2014 at 11:02 p.m.

Last Modified: Thursday, March 6, 2014 at 11:02 p.m.

By a 4-1 vote, Hendersonville City Council approved a plan to allow Preservation North Carolina to market, sell and profit from the sale of the city's last historic industrial building Thursday night.

Council members Jeff Miller and Steve Caraker noted that they were running out of time to secure a developer for the Grey Hosiery Mill with the sunset of a state tax credit looming on the horizon.

Councilman Jerry Smith preferred to try to sell the property through an auction first and said that if the city didn't get any respectable bids, it could always allow PNC to take over the land at that point.

City Manager John Connet said three developers have expressed interest in the property. He said PNC has a national reputation for successfully taking historic parcels threatened by demolition or disuse and connecting them with developers who protect the site's historical integrity.

He recommended the city maintain ownership of the property, but give PNC "the option to receive the property as a donation, if they were able to find a suitable project. So ultimately they would be like a real estate agent. They would market the property, vet any proposals and look for the best option of using the property. They would suggest that we give them one year… to market the property and evaluate all proposals."

He added, however, that the council would have "limited control" of the project and any proceeds from the sale of the property would go to PNC to support the nonprofit.

"How is this different, for example, than just going out and getting a real estate agent?" Smith asked.

"I guess they would be able to put the historic preservation covenants on it," Connet answered. "If historic preservation is the ultimate goal, then they have access to not only the folks that we've talked to but other folks in the state and in the region who deal with historic preservation and also have lots of experience."

"Who has the final say as far as a project moving forward if the property is turned over to this group?" Smith asked.

Connet said PNC could make the decision or could work in partnership with the city to approve a final project.

Miller said that he “didn't like” the second option. "To me that keeps us in the perception of picking and choosing as opposed to letting them pick," he said.

"I think this whole thing for me, personally, is an economic development project," Caraker said. "I don't see much difference in turning this property over to them and letting them find the best use... At arm's length it takes us out of the immediate decision-making process. They don't know any of us. They don't know any of the players. They're basing their decision on what they can do for Hendersonville, what their financial capability is and the merit of the project."

He said he thought "this was the most fair and equitable way to do that, because it takes any local influence over the personality or individual players or passion for a certain type of project out of our hands and gives it to an objective person."

At auction

Miller said he was concerned about a high bidder at auction buying the property and sitting on it.

"If we can work with a group like this, and they have an amazing track record, and get something there that really enhances that building or that location, then we've actually done another part of what we promised to do and that is work on the gateway into Seventh Avenue," Miller said.

"I think there's a great opportunity here and we only have this year to be able to lock into the tax credit, which makes that piece of property more valuable for something like this."

Smith argued that the highest bidder at auction could also get the tax credit.

"Sure, but they could also blow it off," Miller countered.

"You don't have to get the tax credits by going through Preservation N.C.," Smith added.

"It's a whole lot easier because they walk you right through it," Miller said.

"Without the tax credit, there's not enough money to rehab the building. It doesn't make it profitable," Caraker said.

"If this information is correct… if we don't do it by the end of the year and they don't get that credit, it doesn't work to preserve that building," said Mayor Pro Tem Ron Stephens. "It's cheaper to bulldoze it, haul it off and build a new building, which I think somebody will do if we don't get somebody to preserve part of it by the end of this year."

A recent appraisal showed that the fair market value of the property with its buildings onsite would fall in the range of $230,000 to $600,000, or would come in at about $730,000 for the land stripped of its buildings.

"The fact of the matter is, we may end up having to raze the building if the tax credit falls through just to make it sellable," Caraker said. "It's going to cost a couple hundred thousand dollars to raze that building."

He added, "The window is closing for the best opportunity for this piece of property."

Smith said if they started the process now, the city could have it auctioned off by mid-April.

"I just hate to be the one to say, 'you can't buy it, but you can,'" Miller said. "When it gets into that, governments tend to get in trouble."

"I just don't see the problem with putting it up for sale so the city recoups something from this, especially in (the) budget year that we have this year," Smith said. "That property is worth some money to somebody ... and they might be more than willing to line up to pay for it. That's why I think the best option is to go ahead and try to sell it before we pursue" PNC.

Miller asked how the city would arrive at a number for a base bid on the property.

"I don't know why we did an appraisal then," Smith said. "Why did we spend money on that appraisal?"

Miller said, "The appraisal gave us a range that began at the low end with the tax credits coming in and the high end with assuming what it's going to cost to tear it down."

"In a year, we've lost our shot anyway. That being the case, it may well be we have proven that we can't save it, in my opinion, and then we go ahead and take it down and we sell it as a clean piece of property, but I'd like to take a shot at saving it," Miller said before joining the mayor, Caraker and Stephens in a motion to proceed with PNC.

PNC has asked the city to provide suggested review criteria for the property's redevelopment, Connet said.

The Grey Hosiery Mill is listed in the National Register of Historic Places.

According to an appraisal of the property submitted to the city in January, developers would be able to receive state and federal tax credits of 50 percent for a "certified rehabilitation" of the property. The state tax credit of 30 percent, however, will expire at the end of the year.

"If you have not applied or had your project approved by the end of the year, as I understand it, you would not be eligible for the (expiring) state tax credit," Connet told the board.

Long history

The Grey Hosiery Mill has deep roots in the city of Hendersonville.

According to excerpts from the National Register of Historic Places, "The mill operations first began in a small brick building and a small frame structure in 1915 at the corner of Fourth Avenue and Grove Street. The mill originally produced knee-length ribbed stockings for children, manufactured on 32 knitting machines. At this time, the mill employed approximately 25 people. With the invention of nylon around the time of the second World War, production was changed to women's seamless hosiery."

In its heyday, the mill employed 250 people and produced about 66,000 pairs of hosiery a week.

"In 1965, Grey Hosiery Mill was sold to Holt Hosiery Mills Inc. of Burlington, N.C. Holt Hosiery operated on this site for only two years and halted production in 1967," according to the register. "During the 50-year period that the mill operated under the management of the Grey family, Grey Hosiery was a key employer in Hendersonville and Henderson County, and the expansion of the company coincided with the expansion of the town."

"Since 1967, the building has served a number of uses, including a craft store and temporary home for the Henderson County Library. The building is owned by the city of Hendersonville," according to the National Register.

Other business

In other action, Hendersonville City Council approved a request from Beverly Hanks Realty, a new business at 512 N. Main St., to lease nine parking spaces in the city's Apple parking lot. The city will move spaces for the Hendersonville Police Department from the Apple lot to the City Hall lot, a move that will eliminate nine metered spaces which staff says are "underutilized by the public."

Joe Sanders, president of the Blue Ridge Bicycle Club, presented a plan to council to designate Fourth Avenue as a "bicycle boulevard."

The plan involves painting bicycle-use road markings on Fourth Avenue from Laurel Park to Jackson Park to designate the route as a bike-friendly boulevard and remind motorists to share the road. The plan does not require adding bicycle lanes or road improvements, according to the city, and the club is willing to pay for the markings.

Connet asked the council to delay action on the proposal until its April meeting to give the public time to become aware of the project and provide feedback.

Hendersonville City Council also:

-Approved a request from Craig Franks to close an unopened alley located on Summit Circle off of Toms Hill Drive following a public hearing, in which no one spoke.

-Heard an update from Karen Hultin, president of the Hendersonville Sister Cities Inc. on current activities and future plans. The city of Hendersonville became a sister to Almuñécar, Spain in 2010.

-Awarded John D. Stephens of Lawrenceville, Ga., the contract for the Wolfpen Sewer Interceptor project. Stephens was the lowest responsive bidder pledging to do the project for $2,731,043. The final clearance of the award awaits the approval of the N.C. Department of Environment and Natural Resources, according to the city.

-Approved a resolution to donate surplus recycling bins to public schools and other nonprofit organizations such as the Boys and Girls Club.

-Approved a new lease agreement with Norfolk Southern to continue using the Historic Railroad Depot for $11,000 a year, an increase of more than 100-fold in previous rental agreements that charged the city $100 a year. Connet said Norfolk Southern told the city that their “original lease expired a number of years ago.”

-Approved a job description for a new part-time public information officer in order for the city to approve the position.

-Approved special event permits that set the dates of May 9 for the 2014 Bearfootin' Public Arts Reveal; May 15, June 19, July 17, Aug. 21 and Sept. 18 for this year's Rhythm & Brews concerts; and, May 30-31 for the 2014 Mad Mountain Mud Run and Family Mud Run.

<p>By a 4-1 vote, Hendersonville City Council approved a plan to allow Preservation North Carolina to market, sell and profit from the sale of the city's last historic industrial building Thursday night.</p><p>Council members Jeff Miller and Steve Caraker noted that they were running out of time to secure a developer for the Grey Hosiery Mill with the sunset of a state tax credit looming on the horizon.</p><p>Councilman Jerry Smith preferred to try to sell the property through an auction first and said that if the city didn't get any respectable bids, it could always allow PNC to take over the land at that point.</p><p>City Manager John Connet said three developers have expressed interest in the property. He said PNC has a national reputation for successfully taking historic parcels threatened by demolition or disuse and connecting them with developers who protect the site's historical integrity.</p><p>He recommended the city maintain ownership of the property, but give PNC "the option to receive the property as a donation, if they were able to find a suitable project. So ultimately they would be like a real estate agent. They would market the property, vet any proposals and look for the best option of using the property. They would suggest that we give them one year… to market the property and evaluate all proposals."</p><p>He added, however, that the council would have "limited control" of the project and any proceeds from the sale of the property would go to PNC to support the nonprofit.</p><p>"How is this different, for example, than just going out and getting a real estate agent?" Smith asked.</p><p>"I guess they would be able to put the historic preservation covenants on it," Connet answered. "If historic preservation is the ultimate goal, then they have access to not only the folks that we've talked to but other folks in the state and in the region who deal with historic preservation and also have lots of experience."</p><p>"Who has the final say as far as a project moving forward if the property is turned over to this group?" Smith asked.</p><p>Connet said PNC could make the decision or could work in partnership with the city to approve a final project.</p><p>Miller said that he “didn't like” the second option. "To me that keeps us in the perception of picking and choosing as opposed to letting them pick," he said.</p><p>"I think this whole thing for me, personally, is an economic development project," Caraker said. "I don't see much difference in turning this property over to them and letting them find the best use... At arm's length it takes us out of the immediate decision-making process. They don't know any of us. They don't know any of the players. They're basing their decision on what they can do for Hendersonville, what their financial capability is and the merit of the project."</p><p>He said he thought "this was the most fair and equitable way to do that, because it takes any local influence over the personality or individual players or passion for a certain type of project out of our hands and gives it to an objective person."</p><p> </p><p><b>At auction</b></p><p>Miller said he was concerned about a high bidder at auction buying the property and sitting on it.</p><p>"If we can work with a group like this, and they have an amazing track record, and get something there that really enhances that building or that location, then we've actually done another part of what we promised to do and that is work on the gateway into Seventh Avenue," Miller said.</p><p>"I think there's a great opportunity here and we only have this year to be able to lock into the tax credit, which makes that piece of property more valuable for something like this."</p><p>Smith argued that the highest bidder at auction could also get the tax credit.</p><p>"Sure, but they could also blow it off," Miller countered.</p><p>"You don't have to get the tax credits by going through Preservation N.C.," Smith added.</p><p>"It's a whole lot easier because they walk you right through it," Miller said.</p><p>"Without the tax credit, there's not enough money to rehab the building. It doesn't make it profitable," Caraker said.</p><p>"If this information is correct… if we don't do it by the end of the year and they don't get that credit, it doesn't work to preserve that building," said Mayor Pro Tem Ron Stephens. "It's cheaper to bulldoze it, haul it off and build a new building, which I think somebody will do if we don't get somebody to preserve part of it by the end of this year."</p><p>A recent appraisal showed that the fair market value of the property with its buildings onsite would fall in the range of $230,000 to $600,000, or would come in at about $730,000 for the land stripped of its buildings.</p><p>"The fact of the matter is, we may end up having to raze the building if the tax credit falls through just to make it sellable," Caraker said. "It's going to cost a couple hundred thousand dollars to raze that building."</p><p>He added, "The window is closing for the best opportunity for this piece of property."</p><p>Smith said if they started the process now, the city could have it auctioned off by mid-April.</p><p>"I just hate to be the one to say, 'you can't buy it, but you can,'" Miller said. "When it gets into that, governments tend to get in trouble."</p><p>"I just don't see the problem with putting it up for sale so the city recoups something from this, especially in (the) budget year that we have this year," Smith said. "That property is worth some money to somebody ... and they might be more than willing to line up to pay for it. That's why I think the best option is to go ahead and try to sell it before we pursue" PNC.</p><p>Miller asked how the city would arrive at a number for a base bid on the property.</p><p>"I don't know why we did an appraisal then," Smith said. "Why did we spend money on that appraisal?"</p><p>Miller said, "The appraisal gave us a range that began at the low end with the tax credits coming in and the high end with assuming what it's going to cost to tear it down."</p><p>"In a year, we've lost our shot anyway. That being the case, it may well be we have proven that we can't save it, in my opinion, and then we go ahead and take it down and we sell it as a clean piece of property, but I'd like to take a shot at saving it," Miller said before joining the mayor, Caraker and Stephens in a motion to proceed with PNC.</p><p>PNC has asked the city to provide suggested review criteria for the property's redevelopment, Connet said.</p><p>The Grey Hosiery Mill is listed in the National Register of Historic Places.</p><p>According to an appraisal of the property submitted to the city in January, developers would be able to receive state and federal tax credits of 50 percent for a "certified rehabilitation" of the property. The state tax credit of 30 percent, however, will expire at the end of the year.</p><p>"If you have not applied or had your project approved by the end of the year, as I understand it, you would not be eligible for the (expiring) state tax credit," Connet told the board.</p><p> </p><p><b>Long history</b></p><p></p><p>The Grey Hosiery Mill has deep roots in the city of Hendersonville.</p><p>According to excerpts from the National Register of Historic Places, "The mill operations first began in a small brick building and a small frame structure in 1915 at the corner of Fourth Avenue and Grove Street. The mill originally produced knee-length ribbed stockings for children, manufactured on 32 knitting machines. At this time, the mill employed approximately 25 people. With the invention of nylon around the time of the second World War, production was changed to women's seamless hosiery."</p><p>In its heyday, the mill employed 250 people and produced about 66,000 pairs of hosiery a week.</p><p>"In 1965, Grey Hosiery Mill was sold to Holt Hosiery Mills Inc. of Burlington, N.C. Holt Hosiery operated on this site for only two years and halted production in 1967," according to the register. "During the 50-year period that the mill operated under the management of the Grey family, Grey Hosiery was a key employer in Hendersonville and Henderson County, and the expansion of the company coincided with the expansion of the town."</p><p>"Since 1967, the building has served a number of uses, including a craft store and temporary home for the Henderson County Library. The building is owned by the city of Hendersonville," according to the National Register.</p><p></p><p><b>Other business</b></p><p></p><p>In other action, Hendersonville City Council approved a request from Beverly Hanks Realty, a new business at 512 N. Main St., to lease nine parking spaces in the city's Apple parking lot. The city will move spaces for the Hendersonville Police Department from the Apple lot to the City Hall lot, a move that will eliminate nine metered spaces which staff says are "underutilized by the public."</p><p>Joe Sanders, president of the Blue Ridge Bicycle Club, presented a plan to council to designate Fourth Avenue as a "bicycle boulevard."</p><p>The plan involves painting bicycle-use road markings on Fourth Avenue from Laurel Park to Jackson Park to designate the route as a bike-friendly boulevard and remind motorists to share the road. The plan does not require adding bicycle lanes or road improvements, according to the city, and the club is willing to pay for the markings.</p><p>Connet asked the council to delay action on the proposal until its April meeting to give the public time to become aware of the project and provide feedback.</p><p>Hendersonville City Council also:</p><p>-Approved a request from Craig Franks to close an unopened alley located on Summit Circle off of Toms Hill Drive following a public hearing, in which no one spoke.</p><p>-Heard an update from Karen Hultin, president of the Hendersonville Sister Cities Inc. on current activities and future plans. The city of Hendersonville became a sister to Almuñécar, Spain in 2010.</p><p>-Awarded John D. Stephens of Lawrenceville, Ga., the contract for the Wolfpen Sewer Interceptor project. Stephens was the lowest responsive bidder pledging to do the project for $2,731,043. The final clearance of the award awaits the approval of the N.C. Department of Environment and Natural Resources, according to the city.</p><p>-Approved a resolution to donate surplus recycling bins to public schools and other nonprofit organizations such as the Boys and Girls Club.</p><p>-Approved a new lease agreement with Norfolk Southern to continue using the Historic Railroad Depot for $11,000 a year, an increase of more than 100-fold in previous rental agreements that charged the city $100 a year. Connet said Norfolk Southern told the city that their “original lease expired a number of years ago.”</p><p>-Approved a job description for a new part-time public information officer in order for the city to approve the position.</p><p>-Approved special event permits that set the dates of May 9 for the 2014 Bearfootin' Public Arts Reveal; May 15, June 19, July 17, Aug. 21 and Sept. 18 for this year's Rhythm & Brews concerts; and, May 30-31 for the 2014 Mad Mountain Mud Run and Family Mud Run.</p><p>___</p><p>Reach Weaver at Emily.weaver@blueridgenow.com or 828-694-7867.</p>